Ascendas Hospitality Trust to Enter South Korea Market via Acquisition of KY-Heritage Hotel Dongdaemun
Date: April 2018
Location: Dongdaemun area of Seoul, South Korea
Name: KY-Heritage Hotel Dongdaemun – 4 star
No. of Keys: 215
Seller/Buyer: Ascendas Hospitality Trust (“A-HTRUST”) has via Ascendas Hospitality Business Trust, entered into a sale and purchase agreement to acquire 98.7% interest in KY-Heritage Hotel Dongdaemun for KRW72.1 billion (US$89.0 million).
The consideration is at a 3.2% discount to the latest valuation of the Hotel and translates to a
pro forma net property income yield of 4.1%. The Acquisition is expected to be fully funded
by debt.
Mr Tan Juay Hiang, Chief Executive of the Managers said: “The Acquisition is in line with our
strategy to invest in markets with sound hospitality fundamental and growth potential.
Seoul, which is a gateway city in Asia, is a market that we have been exploring for some time.
Situated at an excellent location, the Hotel caters to both corporate and leisure travellers within and around the prominent Dongdaemun area.
It is also well positioned to benefit from the improving hospitality market in Seoul. After completion, the hotel will be managed by an established regional hotel management company and we believe there is potential to enhance asset value through re-branding and re-positioning.”
Ascendas-Singbridge Group is Asia’s leading sustainable urban development and business space solutions provider with Assets Under Management exceeding S$20 billion.
Jointly owned by Temasek Holdings and JTC Corporation through a 51:49 partnership, the Group undertakes urbanisation projects spanning townships, mixed-use developments and
business/industrial parks.
Headquartered in Singapore, Ascendas-Singbridge has projects in 29 cities across 9 countries in Asia, including Australia, China, India, Indonesia, Singapore and South Korea.
Ascendas-Singbridge holds commercial, hospitality and industrial assets across Asia Pacific. It has a substantial interest in and also manages three Singapore-listed funds under its subsidiary Ascendas, namely Ascendas Reit (a Straits Times Index component stock), Ascendas India Trust and Ascendas Hospitality Trust. Besides these listed funds, it also manages a series of private real estate funds.
THPT Comment: Look forward to hearing who will be managing the hotel. International companies already in the area include Fraser Place, Mercure, Westin, Lotte, InterContinental and Banyan Tree…so scope for quite a few others.
First Seen: Ascendas website